The telecom giant's FiOS video service added only 20,000 subs, down from 116,000 in the year-ago period, with the CFO saying the firm is seeing "more and more" users coming to FiOS as broadband-only customers.

Telecom giant Verizon on Thursday reported that it signed up 20,000 net new pay TV subscribers for its FiOS video service in the fourth quarter, compared with a much stronger 116,000 net additions in the fourth quarter of 2014.

Bruce Leichtman, president and principal analyst at Leichtman Research Group, told The Hollywood Reporter that the figure marked the lowest sub growth for the service in any quarter since its launch in 2006. The previous low stood at 26,000.

Verizon ended 2015 with a total of 5.8 million subscribers to the FiOS video service, which competes with cable and satellite TV companies, compared with 5.6 million subs at the end of 2014. It added 178,000 net video subscribers for the full year 2015. The company's latest financial and subscriber update opened quarterly earnings season for pay TV companies.

Analysts have said that telecom companies' pay TV subscriber growth has continued to weaken, while some big cable operators are actually expecting to grow their video subscriber figures for the full year 2015.

"The deceleration in FiOS is extraordinary," said MoffettNathanson analyst Craig Moffett in a first reaction. "Telco TV has seemingly hit a brick wall. It would be easy to blame cord-cutting, but what is really going on is the improbable resurrection of cable. Satellite is facing the same challenge. After a decade of being a net share donor, the big cable operators are taking back share."

Verizon on Thursday, however, touted the demand for its Custom TV service, which offers "skinny" pay TV bundles, saying "customer interest continues to grow for Custom TV, which represented about one-third of FiOS video sales" in the latest quarter.

On an earnings conference call, Verizon CFO Fran Shammo said the company was seeing a continuing decline in demand for linear TV, suggesting that cord-cutting and -shaving, rather than competition, might be a driving force. "We are starting to see more and more customers coming into FiOS on a broadband-only basis," he said. "Customers right-size their existing bundles ... [and] value having a choice in selecting linear video packages." The CFO signaled that Custom TV could update its offerings with different bundles amid these trends.

Shammo on the call declined to discuss a legal showdown with ESPN over Custom TV, calling the Walt Disney sports juggernaut a great partner. But he also said about Custom TV: "We will refresh that here in the short-term to be in compliance with the contractual arrangements that we need to be in compliance with." He didn't provide further details, but at least one Wall Street observer took that as a signal that ESPN could be added to Custom TV's basic offering.

ESPN has argued Custom TV, which combines more than 35 channels, including local TV stations and popular cable networks, and allows subscribers to choose two of seven genre-specific packages, amounts to a breach of contract. Typically, pay TV operators must offer major networks, such as ESPN, on their most widely carried service tier, according to analysts.

Verizon also said it added 99,000 net new FiOS broadband connections in the fourth quarter, compared with 145,000 a year earlier, to finish the year with 7.9 million.

For the third quarter of 2015, Verizon had reported 42,000 net additions for its FiOS video service and 114,000 FiOS broadband customer net additions.

The company last year also launched millennials-focused mobile video service Go90, and Shammo said millennials remain a core focus for the company, which didn't detail Go90 usage data.

In its report, Verizon also highlighted the acquisitions of AOL and Millennial Media, saying they "added capabilities that significantly bolster Verizon’s strategy with strong cross-platform consumer and advertising offerings, particularly in mobile and video." On the earnings call, Shammo said the company was "pleased" with AOL’s performance in the fourth quarter and grew its revenue by $300 million over the third quarter, but didn't break out further figures.

"Verizon embraced transformational change in 2015, and in 2016 the company has a huge opportunity to drive a new era of growth in our industry,” said Verizon chairman and CEO Lowell McAdam.